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High End Luxury Cars

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  • pablo_lpablo_l Posts: 491
    Since it's obvious that $100k+ cars do not sell in huge numbers (it seems all super-luxury cars that have been launched recently, except for the Bentley GT, have been disappointments), it misses the mark to say that price is a non-issue to "many rich people". If that was the case, they'd bypass the S-class and go even more exotic, wouldn't they, and *really* show off what they can spend. They don't. Thus the logic is flawed, and that can be proven with actual sales data in hand: price does play a very significant role in every car segment except for the true exotics. And the super-exotics just get turned over at a constant rate annually.
  • we are not talking about the $100K+ cars here, so I don't think we are missing the mark. The vast majority of cars Lexus, MB, BMW as well as other lux brands sell has overlapping price range, & within this overlapping price range, it's safe to say that buyers can afford any brand within, so price is only one of many different factors in their decision process. And you're still neglecting what many MB & BMW salesman had been saying to their potential customers, that their initial seemingly higher price, could be cancelled out by the expected higher resale on many of their models, plus you get free maintainence service over the warranty period, so at the end of the period of ownership, it's a wash,your real cost of ownership which matter most,isn't higher, plus you get the Mercedes or BMW logo.There is no flawed logic here.BTW, one of the reason the Infiniti Q45 isn't selling despite their lower price is that their resale value sucks, & that it's real cost of ownership isn't lower (or even worse)than it's more expensive competitors
  • Actually I don't think it really is a wash. Never trust car salesman!!! The salesman of expensive cars have even MORE incentive to lead the poor buyer astray.

    TAKE MAINTANCE UNDER WARRENTY.

    If you can afford a $70,000 to $95,000 car you don't want the hassel of constant warrenty repairs...the money is less important then the inconvience. You expect a well made RELIABLE machine that wouldn't strand you somewhere even if the repair is free.
  • pablo_lpablo_l Posts: 491
    ".. you're still neglecting what many MB & BMW salesman had been saying .." Oh, paragons of truth that salesman are.

    The resale stuff... then why is the MB's leasing cost $400+ higher than Lexus'? Depreciation figures highly into leasing costs, and yet... anyone making even very good money *will* care about spending an additional $400 a month, I guarantee that. It's just about the perceived value that $400 buys.

    The price *is* an issue for many buyers, even with these cars. It is not the only issue, nor does it mean they couldn't wing the higher priced car if they really wanted to - they chose not to for a number of reasons, including price. Would more people chose the MB if the price were lower? Well, it isn't, and thus it's immaterial to speculate about it. The fact is Merc can afford to demand a premium, and it works for them.

    Again, it's perceived value. Some people think the MB brand justifies the premium, some think it doesn't, and some simply don't want to pay the additional money - there are a lot of motivations out there, and to lump things into any generic statement does indeed miss the mark.
  • ljflxljflx Posts: 4,687
    I'm completely with you on this. MB residuals have also gone downhill quitte a bit since I priced an LS430 vs. an S-500 lease in 2001. Someone posted a WSJ article a while back that they are lower than both BMW and Lexus. So the residuals do not help and in fact hinder MB pricing even more.
  • oac3oac3 Posts: 373
    You stated: "Some people think the MB brand justifies the premium..."

    Permit me to jump in here.

    I just returned from lunch with a colleague. Here is an example of someone who agreed with that premise. But here is the reality of her experience.

    In Sept. my colleague's wife bought an '03 E320. That car has seen more of the inside of the repair shop than on the road. In 3 months, with only 1,000 miles, it spends most of its days in the shop. Here are the problems. Currently, it's now 17 days in the shop.

    Electrical (what else is new !). The car won't start in the morning, bcos the smart key and the ecu can't agree that the owner want to drive the car off the carport/garage. After sometime waiting in the car, she puts in a second and third attempt, and the car still won't start, making some whirring noise under the hood. MB technicians come over, get the car started and towed to the shop. To duplicate the problem = 3 days. Once a solution is deviced, it takes another 3 days just to be able to test it on the car, bcos that's how long it takes to get the car started.

    The wife has filed for lemon law protection, and waiting to hear on this. She is very disappointed and quite upset, really that MB will complicate an otherwise excellent car, with such electronic gadgetry that confuses instead of improving the driving experience of such a lux car. Oh, she paid a mere $55K OTD in Sept on the 2003 E320.

    I guess we have people who aspire to buy these super-lux cars, only if they knew what they'd be buying. That free mainatainance on the warranty ! You'll need every day of it. I am glad I don't own one of these lemon MB's. Judging by the list of owners with similar problems, MB is in for a long hard time in the future.
  • sv7887sv7887 Posts: 351
    Hi all,

       I think all this talk of MB's demise is being overstated. It simply appears Mercedes is having some issues of late. Given their long history, I'm sure they'll be able to recover. A company like MB won't just cease to be a competitor. Cars like the SL500 indicate that they are still very capable of producing an unbeatable world class car.

        I've said this many times: I see a trend in the luxury carmakers to cram their cars full of electronics. Is there really any purpose for parking radar and all these other useless gimmicks? Like anything, the more complicated the design, the more problems you are going to face.

    I think Jaguar has done the best job of making sure the new age toys aren't too intrusive. I'd pit Lexus second, only b/c I have to switch on the Touchscreen to access my climate control settings. Being greeted with "The Lexus Link System is Active" every morning in my LS430 is driving me nuts. Maybe I'm too much of a purist, but I really think this electronics rage is going too far.

    As for the MB vs Lexus debate. We've all argued to no end that Lexus builds a superb car. The only legitimate complaint that the MB camp may have is the insipid designs they've been turning out as of late. I was given a brand new ES330 for a loaner..Fantastic car inside, and drove beautifully. But the exterior design provokes nothing more than a Yawn. There is absolutely nothing engaging about it whatsoever. I'm anxious to see the what the 2006 LS looks like. If it's another S Class clone, I'll be terribly disappointed.

    SV
  • footiefootie Posts: 636
    This sure sounds like Mercedes dodgeball 101 that a friend of mine who was a MB Salesperson here in Boston was 'indoctrinated' with at their store.

    IMHO: Mercedes problems are many and they are not 'just having some issues' nor does the 'all cars these days are full of electronics which are complicated' argument pass the common sense test given that Lexus can build the same advanced technology and integrate it.

    Plus most of the 'advanced technolog' these days is coming from innovations in the supplier base not from the car companies. Manufacturers that work with their suppliers and still can't get technology to integrate and work properly in their cars are being poorly managed and have the wrong priorities. There are NO excuses.

    Mercedes incidence of failure, defect levels and dissatisfied customers is the HIGHEST in the industry amongst luxury brands per JDP. It's a trend that has been underway for over a decade.

    I think that the Mercedes business approach to putting brand management before customer satisfaction is self correcting.
  • Sometimes, I'm wondering whether you are completely following what we are talking about in the recent discussions.Mercedes competes with Lexus & other lux brands for sales way lower than $100K for probably at least 90 % of the cars they sell. You keep harping on the extreme end case of $400 per month more for a S500 vs. a LS430,whereas the vast majority of the competition occurs at a much lower price difference, & I thought it was you who said we shouldn't pick one case or one factor & broadly apply it to all cases. LOL !! Yes, & people do cross shop between a LS430 & a E500, & unlike some Lexus fans here, I do think there are legitimate & justifiable reasons why a person would pick a E500 over a LS430. I do think the LS430 is more car & a "better" car overall. But, it's no good for a person who has $55 to $70K to spend who want a smaller, sportier sedan and don't care about reliability because it's not intended for daily transportation.
  • ljflxljflx Posts: 4,687
    are deeper than most want to believe. Today I took delivery of my GX470. As I went out to the huge garage - that looks like a place where Boeing would assemble planes - I encountered a couple looking at the GX I was taking. The couple was finalizing an order on a GX with the same color combo I took (or I should say my wife took as I still prefer the LX - but this GX is awfully nice, I must admit) and wanted to be sure they liked it in that combo. The guy asked me about what led me to the GX and as it turned out he was coming out of an ML350 that gave him a lot of problems including various automotive ones. He said he had been buying MB for 20 years but when his E lease expired a few years back he switched over to the GS and went from a problem car to a perfect one and now was expecting the same from the move from the ML to the GX.

    We hear all these accolades about big powerful engines and how the auto rags love performance but in the end if cars this expensive don't function as close to perfection as possible than the experience is a disappointment and all that bragging for a tiny fraction of performance cars is irrelevant. This guy told me the last great car MB built was the old S-class. He's an engineer and fully appreciated the great things MB has done in the past, but in his words the game is electronics now and in that regard the Germans are way behind the Japanese. The problem is MB needs to stay number 1 and to do so they need to lead in an arena where they are trumped. I think the reliability problems will deepen and as they do the brand image will suffer more and more.
  • you also neglected the fact that the fair comparison is really between the S430 & the LS430,where difference in price, or lease rate is much smaller than $400/month, not the case of ljflx where he is comparing pricing/lease rate of the S500 and the LS430 when he was car shopping a couple years ago.
  • ljflxljflx Posts: 4,687
    The problem with that is the LS430 is much more comparable to the S-500 in power. They are about equal with probably a nod to the LS430 - forget the horsepower figures - and deliver the quick acceleration and torque power you'd expect at these price points. I was initially looking at the S-430 and moved away from it right away because it felt underpowered. The S-500 is a much better car than the S-430 (to me at least) and is the real comparable to the LS430. It is the embodiment of the S-class to me. On pricing the S-430 was about $180 more per month than the LS430 in 2001 and only about $200 cheaper than an S-500. You could take your argument and say for a $200 a month difference why would anyone buy an S-430 instead of an S-500. Yet more S-430's are sold than S-500's.
  • well, they look exactly the same & you can order them debadged & it still carries the Mercedes logo.
  • ljflxljflx Posts: 4,687
    The Mercedes 3 pointed star doesn't impress me but the S-500 did and I needed it to make the comparison to the LS430 a fair one. I do understand your point though. I just don't agree with it.
  • pablo_lpablo_l Posts: 491
    Your point now is confused. Either you claim the cost of ownership is the same and thus the brand doesn't matter (a point which is indeed inaccurate), or it isn't. You're trying to state both at your convenience.

    And the key point is that even people who *could* wing either purchase *do* decide to save themselves the additional money - because they don't see the added value, *and/or* because they like to keep $20k in their pocket and vacation for 2 weeks at the Grand Wailea on Maui.

    Again, to claim people don't care whether they spend $60k or $75k is somewhat silly. It's perceived value, and the motivations are highly personal. Doesn't make one car "better" than the other, or one buyer dumber than the other.

    Mattox -

    as to luxury buyers don't wanting maintenance hassles, I don't know, Bentley or Rolls or Ferrari would have gone out of business eons ago if that was the case. Different people expect different things, and some people are very willing to put up with idiosynchrasies.

    Finally, I doubt any experience that winds up calling for leman law is a "typical" Mercedes experience. Sure they have lemons, but it's *not* the typical scenario. That's an exaggeration that does not realistically reflect whatever quality issues MB might have had.

    Also, my wife uncle's LX470 has been trouble ridden, too. In 6 months, it's been in the shop far more often and longer than my wife's '99 ML320 (which has been utterly problem free despite the M's reputation, never been in the shop for anything except maintenance). None of these experiences actually prove much - it's all highly circumstancial stuff.
  • I've been reading about many arguments to what car is the best (Mercedes, Lexus, BMW, etc.). I like to put in my two-cents. When I buy a car, these are my criteria (in order of most important to least) for what car I will choose:
    1. price (most important to me because I can't pay cash for a car--at least not yet)
    2. exterior styling (it has to catch my eyes because I'm the one who has to look at it everyday)
    3. interior ergonomics (I have to sit in it everyday, so it must be comfortable, good to look at, easy to use, and great fit and finish)
    4. reliability (if it's in the shop a lot, what's the use of paying so much money for one)
    5. fun to drive (does it have enough horsepower, do I like the way it handles, is it quiet, does it shift smoothly, does it make my commute not feel like I'm in hell)
    6. service (good service from the time of the sell, easy to make appointments to bring my car in for routine maintenances, good loaner cars, having my car ready and clean when they say it will be finished, and if it needs to be fixed, it will be fixed right the first time)
    7. resale value (it doesn't take a hit if I want to sell it)

    I did not put prestige because only what I think is good about the car matters, not what others think. Too many people buy things to show off--that's a shame, because if you ever are down on your luck, will those people ever look at you the same? I also think that if a car is beautiful to you, then that's all that matters, because looks are subjective.

    Happy Holidays! And as always, drive safely out there.
  • sv7887sv7887 Posts: 351
    Footie,
    As a Lexus owner myself, I certainly can understand your point of view. Lexus has done a great job of integrating all these new electronic toys into their cars. My complaint was more along the lines of "These electronic toys are getting too intrusive" I keep my old 92 LS just to get away from all of it. Some advances such as the Nav system are welcome, but I never really had much use for the parking radar and laser guided cruise control. Maybe it's just me, but I feel all this electronic gadgetry distracts from the driving experience.

    I still think reports of MB's demise are far too premature. MB has its' problems no doubt. But you can't discount their 100+ yr history. If anyone is capable of turning things around it's MB. I recognize the surveys you've presented, and agree that they're in a rut. Give them a few years and I'm sure they'll work something out. Lexus needs to take full advantage of MB's downturn and release more performance orientated cars to steal some more market share. The new concepts posted on this forum are very exciting and I hope Lexus will put them into production.

    I hope do you realize that Merc will launch into one of his long diatribes over your posting. LOL.

    SV
  • My point isn't confused, maybe it was you that are confused at what I'm trying to convey.That's why I said I'm wondering whether you really follow what we're discussing about. I never said nor imply that the brand doesn't matter(that's an individual preference),just that the cost of ownership could be the same in many cases, not the extreme & unfair comparison at the highest end that the 2 brands are competing between a S500 & a LS430 you try to quote lfjx. Again, you are still trying to use one case or one set of consumer behaviour that support your case, and broadly apply it to all consumers at all price ranges, exactly the same thing you suggest that we shouldn't do in an earlier post.
    Some people will try to save money, others will want to get the more expensive brand for status & bragging rights.
    I never said nor imply it makes no difference between spending $60K and $75k, again putting words in my mouth. What I'm saying is you are not really spending the extra $15K if you can resell the more expensive car for $15K more after ownership period. Even if you can resell it for only $10K more, you factor in the free scheduled maintainence that MB (& BMW)offers, the real price difference becomes very minimal, not nearly as important as you and some others are trying to imply. We all know that Mercedes is the brand name with the top resale value in the US all along until the recent article ljflx mentioned that suggest MB's future projected resale values will fall out of the top 5 ? Thus suggesting price alone is an important factor that Mercedes shouldn't be selling more makes no sense to me.Price is only one of many factors that has an impact on sales. MB , Lexus & others do compete in selling at least 90 % of their cars at an overlapping price range.

    Discussing here in the past couple days reminds me of why I've been reading this board for a year, & have resisted joining until recently. Not necessarily directing against you, but I've seen so many confused poster with flawed logic & reasoning, misquoting others, bickering & spreading misinformation, deliberately or not. My last post on this topic, I'm outta here.
  • Like ljflx alluded to, MB problems are serious. No, they are not going away anytime soon, but if you add-up the many issues they face today - reliability worse than Chrysler's, electronic problems, resale values down, down sales (now #3 and about to become #4), tug-o-war b/w Eaton/Schrempf (liars, and lying lies, and ....), need we add more ? Yes, MB is not going to go away, but they sure are hurting, and the hurt will continue unless they solve these structural issues.

    We have seen a 110+-yr-old Barron's Bank go under in just 1-DAY !!! A crooked employee *playing* with derivatives and stuff. Billions of dollars worth of a bank down the tubes .... No one thought it was possible, but it did happen. Poof !
  • Bently, Rolls etc are specality cars that are driven by VERY FEW people. They are driven very few miles and are generally not a daily driver.

    These cars production numbers are in the 100s per year...they are not germain to this discussion...

    As to the LX470 (Your wife's uncles car) I have a hard time believing you for several reasons.

    1) Knowing how you feel about cars and this debate I would think you would have mention these problems before now.

    2) You didn't mention what the specific problem is.

    3) Knowing something about Lexus service I believe they would have replaced the car by now if what you say is true.
  • pablo_lpablo_l Posts: 491
    If the resale value of the Benz was really as high as implied, then it's hard to explain the leasing difference (which is between an S430 -not S500- and an LS430). How can the cost of ownership be the same for someone leasing the car for $400 more a month? I mean, come on, this is very basic math. The Merc *is* more expensive to own, period. It's just not up for dispute.
  • pablo_lpablo_l Posts: 491
    You are wrong - I have no vested interest in any of this, so you don't "know" how I feel about these brands. I don't own nor do I want a Mercedes. I don't own nor do I want a Lexus, even though the SC430 does appeal to me (more than any MB offering other than the CL, which I wouldn't get because a friend has had a horrible ownership experience with).

    I have no specific insight into the LX470 issues other than the complaints of my wife's uncle, because I don't give a hoot and have no interest in what the issues are. I never have felt like making conversation out of something that seems to upset the other person, and since the LX470 is not a car I'd get, I have little interest in researching it. I know it's nothing that impedes the car from driving, and that's about it. Whether you believe it or not I don't care, but your insinuation that I'd resort to lying in this thread means I won't read or reply to stuff you write henceforth.
  • ljflxljflx Posts: 4,687
    Your point is purely theoretical and only works in percentages anyway and not in real dollars. It doesn't happen that way in the real world. For an $85k MB S-500 to work out to an equal cost to a $70k LS430 the S-500 would have to hold 8-10 percentage points higher in residual than the LS430 after 3-5 years. If this was the case and interest payments were equal than the lease payments or cost to own would be the same. But its not. They both hold about the same residual percentage after 3-5 years and and in fact the S-class is actually lower based on that WSJ article. In 2001 the S-class leases I was being offered had a 1-2% higher residual built in than the LS after 3 years but those residuals didn't hold up in the real world. On top of that the lease money factor was 1+% higher and offset just about all of the higher residual percentage in the lease anyway. So whoever financed MB leases in 2001 would have been hurt at lease end on the residual though the higher interest rate taken earlier would have pretty much equalled the score.

    Leasing has many factors - not just residuals. In 2001 Japanese interest rates were 3-4% lower than European rates. Toyota (and any Jaoanese brand) could haver undercut the whole market but they didn't.

    The days of MB holding the high residuals it did in the past are long over. Twenty years ago MB made the best buillt and safest cars that had the highest reliability ratings. But now there is too much competition and they couldn't hold up those qualities, They are still living off that past reputation but it is less and less an influence each year. This doesn't mean they don't build excellent cars. It just means the field has caught up to them and in some cases has surpassed them. Long-term car residuals are held up by high quality reliable cars not by brand names.
  • footiefootie Posts: 636
    Right now, leases on LS430's from TFS have 56% residuals for three years and a money factor of .0018 ( about 4.3% ).

    Leases on S430's from MBCC have 54% residuals for three years and a money factor of .00225 ( about 5.4% ).

    The MB depreciates faster and MBCC factors in more risk with their leases and has to ask for higher interest rates from its customers.
  • pablo_lpablo_l Posts: 491
    http://www.autobild.de/projektor/projektor.php?artikel_id=5531&am- p;pos=1

    Heavens, it's merely a luxury VAN... I expected a bit more attitude of the GST.
  • Are Lexus and Infiniti. Hands down they beat Cadillac's offerings.
  • pablo_lpablo_l Posts: 491
    When I moved to the USA in late '95, a Lexus and an Infiniti were the first cars I got -one for me, one of my ex girlfriend- based on the reputation for reliability. I was getting grounded in a new environment, and the last thing I wanted was car trouble. Neither the SC400 nor the M30 convertible lived up to the reputation for utter reliability, after my ex and I broke up -and she moved back to Europe- I decided to trade them both in an simply go for more passion, since the cars had been acting up anyhow. I got an XJS. The SC went through 4 batteries for reasons unknown, and had paint fade all over the back of the car, and the M30 had ridiculous convertible top issues. Both service departments were excellent, and despite the spotty track record of both cars I don't hold the experience I had against the brands, but merely to bad luck, and who knows what my ex had done to the Infiniti top, she was not what you'd call a caring owner. I haven't brought up either experience up in this thread because I believe it is merely circumstancial and meaningless stuff, but since you feel like doubting my credibility, there it goes. Anyone that does a search for my user id on this web site will find allusion to both ownership experiences -without any brand bitterness- throughout my years on these boards.

    I'll also freely admit to feeling downright antipathy for the MB brand until my wife wanted the ML badly in the post-Jurassic Park marketing craze, when the ML became *the* car to have for a while. Despite my expectations, the car has proven to be a total darling, which comes to show how much you can trust brand perception stuff.

    That is why I don't believe at all in going by reputation that others repeat at nauseam when it comes to car purchases: as a rule, when I have done that, I have been underwhelmed. Bad luck. And the cars I had the lowest reliability expectations for -the XJS convertible and the ML- proved to be utter darlings that didn't have one single issue other than going in for maintenance intervals.

    Oh, just to ridicule your doubts about the authenticity of my claim, I offer this forum to post a picture of my wife uncle's LX470 and his wife's Jaguar XKR, parked side by side in their house, by the end of the day tomorrow on my web site. In turn, you'll have to shut the hell up. I find it pathetic of you that, when one single message doesn't agree with your small-minded view of the car universe, you have to resort to accuse someone of lying.
  • No one accused you of lying...I simply said I didn't believe you there is a difference.

    While your Uncle is in town I would be interested to know what has kept his Lexus in the shop for most of 6 months. Glad to see it is back on the road.
  • pablo_lpablo_l Posts: 491
    You said you didn't believe what I'd said, and I have never claimed it has been in the shop "most of the time". All I stated is he's unhappy because he's had to bring it into the shop several times. The only problem I have heard about has to do with the DVD player that's built in, the other issues I am utterly unfamiliar with - I know my wife had to pick him up from his company once because his car had some issue. And I have heard him complain about it. That's all. He had an LS400 previously, and was a vocal Lexus advocate. Oh, and his wife had an SC400, so they were an all Lexus household for a while, but she went Jag. None of this means he won't buy a Lexus again, nor is it meant to remotely indicate that Lexus is not a desirable car brand. All it means is that everybody is mortal, and if you look closely enough all brands will have occasional issues - the key to the luxury buyer is how they deal with it. It is utterly unrealistic to expect that any complex engineering device will always be utterly and totally flawless every time. Eventually statistics will bite one of us.
  • Footie, nice post. Does it mean that there is really no significant difference in residuals (I calculate a spread of .035 or so) and money factors?? If, so can we agree that the total ownership cost is about the same?
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